 Drugs, Showrooms and Financial Products: Competition and Regulation when Sellers Provide Expert AdviceDavid Bardey, Denis Gromb, David Martimort and Jerome Pouyet No 15231, Documentos CEDE from Universidad de los Andes, Facultad de Economía, CEDE Abstract: We consider a market in which sellers can exert an information gathering effort to advise buyers about which of two goods best fits their needs. Sellers may steer buyers towards the higher margin good. We show that for sellers to collect and reveal information, profits on both goods must be sufficiently close to each other, i.e., lie within an implementability cone, which competition or regulation may ensure. Instruments to do so vary with the context. Controlling market power while improving the quality of advice is more difficult when sellers have private information on the profitability ofthe goods. Keywords: Mis-Selling; Expertise; Retailing; Competition; Regulation; Asymmetric Information. (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:col:000089:015231 Access Statistics for this paper More papers in Documentos CEDE from Universidad de los Andes, Facultad de Economía, CEDE Contact information at EDIRC. |
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